Littlewoods seeks to cut 100 top managers
Monday 21 September 1998
Littlewoods is offering voluntary redundancy terms to 500 head-office managers and is hoping they will be accepted by at least 100. The Liverpool- based business has earmarked between pounds 4m and pounds 6m to cover the costs, although these are included in the pounds 73m restructuring provisions announced earlier this year.
The payments equate to an average of pounds 50,000 per person, the equivalent of two years' salary, the company said.
Littlewoods is also planning to simplify its pay and benefits scheme. Currently there are 22 "zones", or employment levels, including nine for management. These will be reduced to a flatter structure with individually negotiated contracts. The company's fleet of 700 company cars will also be reduced. The move is part of plan to consolidate Littlewoods' three divisional offices in Liverpool into one site.
The restructuring is being led by Barry Gibson, the Littlewoods chief executive. He is trying to introduce a more modern, dynamic management approach based on performance rather than length of service.
The company has also announced plans to strengthen its board. Susan Murray, who ran the Smirnoff vodka brand for Grand Metropolitan before the merger with Guinness, is joining as marketing director. David Hallett has joined from Argos as information technology director. The search is continuing for a new finance director to replace Jim Michie, who has moved to become corporate development director.
At the trading level, high-street stores currently being tested under the Berkertex banner have performed no better than those under the existing Littlewoods name. Although a final decision will not be taken until after the Christmas peak sales period, it is considered unlikely that the Littlewoods name will be entirely jettisoned.
Littlewoods and Granada have announced further details of their new home shopping channel that will run on digital television. Called "Shop!", the channel will begin broadcasting from Albert Dock Studios in November. Littlewoods is in talks with other retailers who may join the channel, although it is unlikely that any will sign before the launch of ONdigital, the Granada and Carlton joint venture, in November.
Littlewoods plans to run trial "new media centres" in two of its stores from November to coincide with the launch. The stores in High Wycombe and Birkenhead will feature separate areas with television sets and armchairs where customers can order from the Littlewoods Index Extra catalogue and place orders via the television channel.
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